Country a and Country B Are the Same Except Country

question 314

Multiple Choice

Country A and country B are the same except country A currently has a lower level of capital. Assuming diminishing returns, if both countries increase their capital by 100 units and other factors that determine output are unchanged, then

• A)output in country A increases by more than in country B.
• B)output in country A increases by the same amount as in country B.
• C)output in country A increases by less than in country B.
• D)None of the above is necessarily correct.

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